The people behind the proposal to build the world’s largest dredged islands in Utah Lake describe themselves as conservationists. However, recently revealed fundraising materials from the group tell a different story. Dated June 2021, the document described in this Salt Lake Tribune article has now been provided to Conserve Utah Valley by a whistleblower that Lake Restoration Solutions (LRS) tried to recruit.
Because we believe our community deserves to know what the developers are telling their investors about this project that would fundamentally reshape the future of Utah Valley, we are attaching the fundraising materials at the bottom of this blog post. The document includes important details about the financial structure of the real estate venture and some specifics about the proposed work.
Following the Money
The public front of the island project is a limited liability company called LRS, but the fundraising materials reveal the financing is being funneled through a limited partnership (LP) called the Utah Lake Development Fund. This LP consists of two main partners: Foresight Wealth Management and Prospera Growth Fund. These partners would collect investments from extremely wealthy “Qualified Clients.” Based on their estimates, these investments would yield a 1.95 to 3.0-fold net return within 4 to 5 years.
The document includes several letters of support, including a letter from the Utah Governor’s Office of Economic Development committing a $10 million legislative appropriation for an LRS loan guarantee. This letter was dated October 2020, during the tenure of former Governor Gary Herbert. Additional letters show that Prospera committed $15 million, and Foresight committed $10 million to LRS to initiate the project. The most surprising letter comes from the mayor of Vineyard city, Julie Fullmer, who “appropriates $5,000,000 cash or cash reserves to be used for eligible approved project related costs.” The city council of Vineyard was not aware of this commitment, and it remains unclear if Mayor Fullmer had the authority to legally sign the letter.
Though LRS has repeatedly told the public that the start of work is years away, this document reveals they intend to start dredging in the summer of 2023 and selling land in May of 2025. The project’s “Phase 1” consists of a series of islands just off the shoreline from Vineyard, American Fork, Lehi, and Saratoga Springs. The first island would be called “American Fork Island” and would have around 60 lots ranging from half-acre to 7-acre estates. LRS claims that they have land purchase commitments for around 70% of the Phase-1 land—nearly 2,500 acres.
In contrast with LRS’s public statements that land sales would occur only after completion of restoration, this document states that “Importantly, Phase 1’s outcome is not dependent on LRS’s future phases.” Because Phase 1 consists almost entirely of development land, this means that LRS could build and sell approximately 3,000 acres without providing any restoration benefit to the lake or creating recreation or wildlife islands for the community. According to the per-acre price estimates in the document, the land sales in Phase 1 could generate $1.95 billion in revenue for LRS.
10% For the Environment
LRS writes, “Of the ~20,000 acres created, 16,508 acres are intended as development land. The remaining 3,500 acres will be recreation and estuary islands for environmental and public-use purposes.” LRS’s Army Corps application further reduces the recreation and estuary islands to only 10% of the overall acreage (see this independent evaluation of their application here).
Foresight’s commitment letter indicates that LRS has the “intent of selling the real property for private development and municipal management.” This means that while LRS has been telling the public that only 50% of the new land would be privatized, they will be able to sell 90% or more of the island area. Using LRS’s upper estimates of land value ($650K an acre), the sovereign land that would be transferred from the people of Utah to their company would be worth $10.7 billion.
The budget summary that LRS provides raises additional questions about their priorities. Now that the Provo Bay portion of Phase 1 has been cut and the recreation islands have been reduced, only $1.1 billion is earmarked for “restoration,” though even this number includes activities that would be better described as project damage mitigation. Most of this “restoration” work would be financed with the $893 million federal loan LRS is seeking from the EPA.
Like all their public documents released to date, LRS provides very little to no detail about how they would deliver the described benefits. For example, LRS claims that the project would save 34 to 40 billion gallons of water by reducing evaporation and increasing the lake’s storage capacity by 40%. However, water managers and hydrologists have questioned these claims, forcing LRS to admit that these numbers were largely made up. In this interview, LRS president Jon Benson said, “Of all the numbers that are preliminary, that’s the most preliminary.” Likewise, no evidence is provided in this document or the Army Corps application to support the claims that the project would improve circulation, increase water clarity, restore native species, or reduce algal blooms.
See For Yourself
Here is the link to download and evaluate LRS’s fundraising materials.